Saudi Arabia unveils tech-heavy economic vision

October 29, 2017
Extended hand to technology. Aurore Chiquot of SoftBank Robotics Europe extends her hand to a robot during the Future Investment Initiative conference in Riyadh, on October 25. (Reuters)

London - Saudi projects ranging from a mega business zone involving territory in three countries to a billion-dollar investment in private space flight have been announced.
The Future Investment Initia­tive (FII), a high-profile drive in­augurated by Saudi Crown Prince Mohammed bin Salman bin Ab­dulaziz, involved the government pitching its vision to more than 2,500 participants from around the world.
By looking to invest in technol­ogy and diversifying its economy, Saudi Arabia appears to be model­ling itself as a Silicon Valley of the region.
The FII included panels with in­ternational business leaders and analysts discussing the economic concepts and challenges facing Saudi Arabia and served as a plat­form for Riyadh to make big an­nouncements, primarily its $500 billion project for a mega-city and business zone called NEOM.
The kingdom’s Public Invest­ment Fund (PIF) said NEOM would “seek to maximise the natural ad­vantages the area has for wind and solar energy and is being support­ed by SoftBank’s Vision Fund, led by former Alcoa and Siemens CEO Klaus Kleinfeld.”
The project will include part­nerships with leading technology firms, with public backing secured from robotics experts Boston Dy­namics.
“There will be many opportuni­ties but we will work only with the dreamers, people who want to cre­ate something new in the world,” Crown Prince Mohammed said.
The project will result in a 26,500 sq.km high-tech hub extending into Jordan and Egypt and would focus on the future of energy and water, transport, biotechnologies, technical and digital sciences, as well as media production and en­tertainment.
Riyadh aims to create job op­portunities, expand the kingdom’s GDP and attract investment from the private and public sectors, which will be supported by more than $500 billion from the PIF and local and international investors.
Softbank Chairman and CEO Masayoshi Son called it an oppor­tunity to create “the largest and most advanced generation of ro­bots in the world.”
Kleinfeld promised that NEOM would be a “beautiful and natural place” for the best and the bright­est to make their mark for genera­tions.
Crown Prince Mohammed also said in an interview with Reuters that NEOM would be listed on fi­nancial markets along with the kingdom’s oil giant Saudi Aramco to diversify the economy away from the energy sector.
He reiterated that Aramco’s ini­tial public offering (IPO) was on track for 2018 and would be val­ued at more than $2 trillion. NE­OM’s IPO would likely be further down the line, he said.
“It might be after 2030; it might be before but the idea and the strategy are to float it eventually,” he added.
The PIF said it was investing $1 billion in Richard Branson’s space tourism company Virgin Galactic. The announcement came about a month after Branson said he would invest in the kingdom’s Red Sea luxury tourism project.
“This investment will enable us to develop the next generation of satellite launches and accelerate our programme for point to point supersonic space travel,” Branson said.
Branson said Virgin Galactic was “months away” from launching vehicles into space with people on board.
The PIF released its first com­prehensive business plan during the conference, which hopes to increase its assets under manage­ment to $400 billion by 2020 from approximately $230 billion now.

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